October 2 Dear Fello The Intern nation. Ou subscripti employee $7.99 unl than doub Netflix me proposed reputatio as ever an (in millions excDomestic: Streaming S DVD Subscri Total Uniqu Y/Y Change Net Subscri Y/Y Change Revenue Y/Y Change Contributio Y/Y Change Operating In Y/Y Change Internatio Subscription Net Subscri Revenue Contributio Global: Revenue Y/Y Change Net Income Y/Y Change EPS Y/Y Change Free Cash Fl Buyback Shares (FD) 24 th , 2011 ow Sharehold net is transfo ur opportunit ion service on es, and most u imited stream bling domesti embers with ‐and‐now‐ca n, and stalled nd we are mo ept per share data) : Subscriptions iptions e U.S. Subscriber ber Additions n Profit ncome onal: ns ption Additions n Profit (Loss) ow ders, rming video e ty is to be one n the planet. unfortunately ming service b ic spending o our significan ncelled rebra d our domesti oving forward Q3 '09 rs 11.11 28% 0.51 95% $ 423 $ 24% $ 89 $ 32% $ 49 $ 45% ‐ ‐ ‐ ‐ $ 423 $ 24% $ 30 $ 48% $ 0.52 $ 58% $ 26 $ $ 130 $ 57.9 entertainmen e of the leade The last few y, many mem by embracing n streaming c nt DVD‐relate nding of our ic growth. Bu as quickly as Q4 '09 Q1 12.27 13. 31% 3 1.16 1. 61% 8 445 $ 4 24% 2 98 $ 1 38% 5 53 $ 39% 6 ‐ ‐ ‐ ‐ 445 $ 4 24% 2 31 $ 35% 4 0.56 $ 0. 47% 5 30 $ 79 $ 1 55.5 54 nt, stream by ers of this tra w months, how mbers of Netfl new platform content over d pricing cha DVD service. t our long‐ter s we can to re '10 Q2 '10 .97 15.00 5% 42% .70 1.03 5% 255% 494 $ 520 5% 27% 111 $ 130 3% 40% 58 $ 77 1% 45% ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ $ 494 $ 520 5% 27% 32 $ 44 5% 38% .59 $ 0.80 9% 48% 38 $ 34 108 $ 45 4.8 54.3 stream, cons nsformation wever, have b ix. While we ms, simplifyin 2010, we gre nges, and to In doing so, rm streaming epair our repu Q3 '10 Q4 16.80 19 51% 5 1.80 2 253% 13 $ 553 $ 31% 3 $ 130 $ 46% 5 $ 72 $ 47% 0.13 0 0.13 0 $ ‐ $ $ (3) $ $ 553 $ 31% 3 $ 38 $ 27% 5 $ 0.70 $ 0 35% 5 $ 8 $ $ 57 $ 53.9 5 sumer by con with the best been difficult e dramatically ng our user‐in eatly upset m a lesser degr we’ve hurt o g opportunity utation and re 4 '10 Q1 '11 9.50 22.80 59% 63% 2.70 3.30 33% 94% 592 $ 706 33% 43% 152 $ 187 55% 68% 88 $ 113 66% 95% 0.51 0.80 0.38 0.29 4 $ 12 (9) $ (11) 596 $ 719 34% 46% 47 $ 60 52% 88% 0.87 $ 1.11 55% 88% 51 $ 79 ‐ $ 109 54.2 54.2 sumer, natio t streaming v for sharehold y improved o nterface, and any domestic ee, with the our hard‐earn y is as compel eturn to grow Q2 '11 Q 2 1 24.59 2 64% 1.80 75% ‐ $ 770 $ 48% $ 213 $ 64% $ 124 $ 61% 0.97 0.16 $ 19 $ $ (9) $ $ 789 $ 52% $ 68 $ 55% $ 1.26 $ 58% $ 60 $ $ 51 $ 53.9 1 n by video ders, ur more c ed lling wth. 3 '11 21.45 13.93 23.79 42% ‐0.81 145% 799 44% 219 68% 120 67% 1.48 0.51 23 (23) 822 49% 62 63% 1.16 66% 14 40 53.9